The Game of Brexit

In one way it is fortunate that the pre-negotiations on Brexit have staked out the territory.

The game has crystallised into two dimensions – controls to reduce unwanted migration into the UK versus the freedom of movement of European citizens to accompany the same freedom for goods, services and capital. The course of the game and its outcome can then be predicted by a standard game theory game called the Prisoner’s Dilemma.

In its simplest incarnation this dilemma is set by two prisoners who have a choice whether or not to co-operate. Co-operation would see both receive short sentences. If only one chose not to co-operate, or to defect, he would go free leaving his colleague with a much longer sentence. If both chose to defect, both would receive moderately longer sentences.

The best overall outcome for both prisoners is to co-operate. However, if each prisoner acts rationally in their own self-interest, the logical outcome is for both to defect and receive the longer sentence.

In a Brexit context, for the UK Government to accept free movement of European citizens is to ignore the democratically expressed will of the British people. For the European Union (EU), denying the right to free movement of its people is to deny a founding principle that is designed to create, over time, a harmonious European society. In practice, it would be the end of the EU project if there were to be EU citizens that did not share common freedoms.

The simple game theory outcome, following the red arrows, is as obvious as it was for the proliferation of nuclear weapons in the 1960’s. At that time the weapon’s arsenal of the US and the USSR grew to a size that could destroy the world many times over. That war was avoided was due to a mutually assured destruction (MAD). This was a shared non-co-operative end point of the prisoner’s dilemma.

There were winners in this scenario, particularly participants in the American industrial-military complex. There were other more unexpected outcomes: man walking on the moon and the internet – a communications system robust enough to withstand nuclear attack.

So for Brexit, in the first instance, one should expect the outcome to be hard too. Successful enterprises will be those that anticipate the opportunities that emerge.

There is another angle to consider if an emerging empathy is detected between the EU and UK.  Given time, the benefits of co-operation may become appreciated by all. This is consistent with an iterated game theory, following the green arrows, through which the conflicting parties learn by degrees to trust their counterpart.

Over time MAD moved to nuclear arms limitation, making the world a somewhat safer place and saving the huge financial and environmental cost of continually upgrading nuclear weapons technology. The same could happen with Brexit.

So, detecting an early warming of EU-UK relations would indicate the possibility of a different outcome to something incompressibly hard.

by John Egan

Follow on twitter: @johnmegan


 Other articles associated with today’s editorial:-

Editorial: Should they stay or should they  go?

Middle ground manoeuvers by Geoff Kitney

The political logic of a hard Brexit by Jacek Rostowski